Lotte Duty Free’s Japan Ginza store doubles sales for third year in 2018

By Charlotte Turner |

Lotte-Duty-Free-Ginza-downtown-store-leadImproved diplomatic relations between China and South Korea during the past 12 months, which facilitated the return of Chinese group tour travellers to Lotte Duty Free’s overseas shops, has helped the Korean retailer to double its sales for the third consecutive year in Japan.

 

Lotte Duty Free’s Ginza downtown store sales doubled to JPY10bn ($93.5m) in 2018 as a result; up from JPY5bn ($46.8m) the previous year.

 

Duty free goods accounted for 70% of customer purchases last year, while tax free goods made up the remaining 30% share.

 

“Our total sales were JPY10bn in financial year ending 31 December, 2018 (FY2018) and we have already achieved JPY 10bn sales from January to June this year,” insists Lee Sung Chul, Sales Department Director, Lotte Duty Free Japan [Sales and Marketing Division], in an exclusive interview with TRBusiness.

 

RECOVERY FROM THE THAAD ISSUE

“There are several reasons for this. From September 2018 our business recovered from the THAAD issue. Currently 50 to 70 tour groups visit our Ginza store everyday; that’s about 1,500 to 1,700 people who are mostly Chinese.

 

Lee-Sung-Chul,-Sales-Department-Director-in-Lotte-Duty-Free-Japan’s-Sales-and-Marketing-Division.

Lee Sung Chul, Sales Department Director, Lotte Duty Free Japan.

 

“In fact, Chinese and Taiwanese visitors make up 90% of the total. Japanese customers represent 5% and South Korean visitors 2%.”

 

Like many operators in Japan, perfume & cosmetics is Lotte Duty Free Ginza’s most profitable category, accounting for 60% of duty free sales in 2018.

 

Tobacco represented 20% of Lotte Ginza’s downtown duty free sales in 2018, with Iqos being the leading cigarette brand.

 

“Watches sales make up around 15% of sales; Omega and Longines are popular brands,” reveals Lee.

 

“Both ladies’ and men’s watches priced between JPY 300,000 and JPY 500,000 are popular; especially Omega as I already mentioned.”

 

In fact, Lee reveals that Lotte Duty Free Ginza is one of Japan’s top selling stores for Omega products.

 

The comprehensive Japan Report can be found in the October issue of TRBusiness magazine, which can be picked up at the TFWA World Exhibition in Cannes (30 September-04 October), together with the indispensable Top 10 Operators Report.

 

Cosmetics-account-for-about-60%-of-Lotte-Ginza’s-total-tax-free-sales.

Cosmetics account for about 60% of Lotte Ginza’s total tax free sales.

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